According to How Appealing, the Fourth Circuit today did not reach the merits on two challenges to the Patient Protection and Affordable Care Act's health care mandate passed by Congress last year. Click here for the Reuters story.

The court ruled in Liberty University v. Geithner (decision available here) that the Federal Anti-Injunction Act "strips us of jurisdiction" over the suit because it was a "pre-enforcement action seeking to restrain the assessment of a tax." And in Virginia v. Sebelius (decision available here), the court determined that Virginia did not have standing to sue.

The Anti-Injunction Act prohibits any lawsuit whose purpose is "restraining the assessment or collection of any tax." Though would-be plaintiffs may sue for a refund on taxes already collected, they may not seek to restrain officials from collecting the taxes in the first place under the provisions of this law.

In Liberty University v. Geithner, the panel determined, despite the fact that both the plaintiffs and the federal officials being sued asserted in their briefs that the Anti-Injunction Act did not apply, that the Act took away the court's jurisdiction to hear the case.

In doing so, the panel concluded that the penalty for not complying with the individual mandate constituted a "tax" under the AIA. The Supreme Court has defined the AIA's use of the term "tax" to include "penalties that function as mere 'regulatory measure(s) beyond the taxing power of Congress' and Article I of the Constitution," according to the 2-1 opinion by Judge Diana Gribbon Motz. The Court's interpretation of the statute includes the mandate at issue in Liberty University, writes Judge Motz.

Judge Andre Davis, dissenting, relies on Congress's repeated use of the term "penalty" to describe the mandate to argue that the AIA does not bar the suit. Reaching the merits, he finds that the Commerce Clause authorized Congress to pass the mandate. Judge James Wynn, concurring in Judge Motz's opinion, writes that if he were to reach the merits, he would uphold the statute under Congress's taxing and spending power.

In Virginia v. Sebelius, the unanimous panel, in another opinion written by Judge Motz, held that the Virginia law stating that "(n)o resident of this Commonwealth . . . shall be required to obtain or maintain a policy of individual insurance coverage," was insufficient to give the commonwealth standing to challenge the individual mandate.

The judges found that state laws successfully used to support standing in the past have "regulated behavior or provided for the administration of a state program." In contrast, the law in this case merely states its opposition to the federal health care law, according to the court, and Virginia was merely suing on behalf of its citizens, which is impermissible under the Supreme Court's standing doctrine.

Furthermore, the opinion says, if the standing of Virginia were conceded, states seeking in the future to enjoin federal laws could simply pass their own laws denying the legitimacy of these federal laws. This power "would convert the federal judiciary into a 'forum' for the vindication of a state's 'generalized grievances about the conduct of government,'" according to the panel, and is thus not permitted under Article III of the Constitution.

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